03 března 2010

03/03 Ken Veksler's Market Commentary

Good morning,

What a funny old market this really is. Pain to be had everywhere and a lot of punters are wearing it this morning. News and moves from overnight hitting the antipodeans first was the much better GDP data out of Australia which gives the AUD a bid tone but sold off nonetheless later in the session. My beleaguered AUDNZD is showing me some pain as a result but I maintain my resolve and now have a firm stop in place at the 1.3090 level. Elsewhere we had an article outlining the potential disaster that is the Prudential/AIG deal falling over after all has been said and done, on the back of that we see the Cable give back some of its recent losses despite rumors that Prudential had already hedged their FX exposure on the deal. Cable traded back to 1.5075 in a heartbeat cleaning out some weak last minute shorts. I think there is more upside to this Cable and the zone between 1.5050 and 1.5150 is a legitimate area to target. Please understand I’m not advocating being long on the contrary I target that zone to establish fresh shorts but in the interim I think we retrace as clearly people started getting on this trade late in the piece and won’t have the bottle to hold in a market that’s fast cleaning out against them.

The EURUSD caught a very bid tone overnight targeting once again the 1.3680 area of intermediate resistance. The rally only got as far as the 1.3650 area but still keeps a bid tone this morning as the market awaits leaks and headlines out of the Greek meeting where a new austerity package worth a rumored 4.5bn is to be announced including measures such as further pension freezes and higher duties on luxury items etc. Merkel is still vehemently denying offering any help, but I think that’s just to quell the disharmony amongst her constituents. On the day I look for the EURUSD to run higher and I look to fade rallies into 1.3680 and 1.3730. Remember the pivot is now 1.3840 and as long as we stay below that level we maintain the downward bias.

USDCAD maintains its range and I buy on dips into the 1.0280/0330 zone looking for a return into 1.0550 and above.
USDJPY…. Well you all know how I feel about this pair sell rallies into 90.30 and above.

On the data front keep an eye on Euro zone retail sales and further out the US ISM numbers this afternoon.

Best regards,

Ken Veksler.

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